DALSA Reports Record Second Quarter Revenues; Increases Guidance.WATERLOO, Ontario Coordinates: Waterloo is a city in Ontario, Canada. It is the smallest of the three cities in the Regional Municipality of Waterloo, and is adjacent to the larger city of Kitchener. -- Semiconductor Business up sharply; Cash flow increases; Company-wide bookings continue to strengthen DALSA Corporation (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :DSA (1) (Directory Server Agent) An X.500 program that looks up the address of a recipient in a Directory Information Base (DIB), also known as white pages. It accepts requests from the Directory User Agent (DUA) counterpart in the workstation. ), an international high performance semiconductor and electronics company, today reported record revenues of $39.8 million in the second quarter and net income of $4.1 million or $0.24 per share, diluted. The Company also increased its guidance for 2004. The following table summarizes the key results for the quarter and compares them to the same quarter last year: (In millions of dollars, Increase except per share amounts) Q2, 2004 Q2, 2003 (Decrease) --------------------------------------------------------------------- Total Revenues $39.8 $32.7 22% --------------------------------------------------------------------- Total Net Income $4.1 $2.3 76% --------------------------------------------------------------------- Earnings Per Share (diluted) $0.24 $0.14 71% --------------------------------------------------------------------- Gross Margin 41.5% 42.3% (0.8)p.p.(a) --------------------------------------------------------------------- Order Backlog $51.0 $38.7 32% --------------------------------------------------------------------- Cash Flow From Operations $7.8 ($2.5) --------------------------------------------------------------------- (a) percentage points "I am very pleased with our second quarter results. We delivered record revenues and strong profitability, while significantly growing our business in key target markets," said Savvas Chamberlain, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of DALSA Corporation. "In the quarter, MEMS (MicroElectroMechanical Systems) Tiny mechanical devices that are built onto semiconductor chips and are measured in micrometers. In the research labs since the 1980s, MEMS devices began to materialize as commercial products in the mid-1990s. revenues were up over 55% compared to the first quarter. Sales in the wafer, flat panel display A thin display screen for computer and TV usage. The first flat panels appeared on laptop computers in the mid-1980s, and the LCD technology became the standard. Stand-alone LCD screens became available for desktop computers in the mid-1990s and exceeded sales of CRTs for the first time , and electronics inspection market segments increased close to 30%, while revenues from professional digital photography/broadcast were up approximately 50% compared to 2003. Company-wide, bookings grew to record levels and we generated significant cash. We are updating our financial goals for 2004 to reflect our positive outlook on the year." The Company's Semiconductor Business posted record revenues and profits in the quarter. Revenues grew to $17.5 million in the quarter, up 32% over the same period last year and up 36% over the first quarter of 2004. The increase is due to strong sales in MEMS, High-Voltage CMOS (Complementary Metal Oxide Semiconductor) Pronounced "c-moss." The most widely used integrated circuit design. It is found in almost every electronic product from handheld devices to mainframes. and analog mixed-signal CMOS. Earnings for the Semiconductor Business were $2.5 million, up 158% from the same period last year and up 79% over the first quarter of 2004. The Company expects continued strong sales growth over the prior year for the remainder of 2004. In the second quarter, the Digital Imaging Business posted revenues of $22.3 million, up 14.9% from the second quarter of 2003, but down from $23.9 million in the first quarter of 2004. Net income was $1.6 million, up 19.2% compared to the same period last year. Although year-to-date results are on target for the unit, results for the quarter were below expectations due mainly to delays in start dates for new Application Specific Contracts ("ASC ASC Ambulatory surgery center, see there "). In addition, certain ASC follow-on product shipments were moved to the third quarter due to customer integration delays and certain raw material supply issues. Standard product sales were $19.4 million compared to $18.3 in the second quarter of 2003 and $21.0 million in the first quarter of 2004. The ASC group generated $2.9 million in revenue from custom development contracts, up 155% from the same period last year and approximately equal to the first quarter of 2004. A significant portion of the revenue related to contracts for the semiconductor inspection market. The Company's order backlog increased to $51.0 million from $38.7 million in the same quarter last year and from $48.6 million in the first quarter of 2004. The Digital Imaging backlog is increasing due to a general improvement in the machine vision markets, particularly in semiconductor and flat panel display inspection. Bookings in the Semiconductor Business continue to be strong, with a book to bill ratio of 1.1. Cash provided from operating activities was $7.8 million in the quarter compared to cash used in operating activities of $2.5 million in the same period of 2003. The Company increased its net cash position in the quarter by $3.1 million. Overall gross margins for the quarter were 41.5%, down 0.8 percentage points from the same quarter last year. Gross margins increased sharply in Semiconductor Business due to an increased volume of production, more favourable product mix and yield improvement programs. Gross margins in the Digital Imaging Business were down due mainly to the unfavourable impact of the stronger Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents and the additional provision for obsolete inventory Obsolete Inventory Term that refers to inventory that is at the end of its product life cycle and has not seen any sales or usage for a set period of time usually determined by the industry. This type of inventory has to be written down and can cause large losses for a company. in the relocated Life Sciences operations and the mix of product deliveries from Professional Imaging. Management expects margins to be within its target range of 40-45% throughout 2004. For further detail, please refer to the Second Quarter 2004 Financial Statements, accompanying notes, and Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial at the DALSA website. The address is http://www.dalsa.com/investor/2004/DSA_2004Q2_release.pdf Digital Cinema Update The Company continues to be on target in commercializing its Origin camera, the world's first and only digital cinematography cinematography: see motion picture photography. cinematography Art and technology of motion-picture photography. It involves the composition of a scene, lighting of the set and actors, choice of cameras, camera angle, and integration of special camera with the resolution and exposure latitude Exposure latitude is the extent to which a light-sensitive material can be over or underexposed and still achieve an acceptable result. Since the acceptability of the result is dependent on both personal aesthetics and artistic intentions, the measurement of exposure latitude is by (dynamic range) necessary to rival film. As announced in April, DALSA plans to establish a Hollywood-based partnership to distribute Origin cameras, storage equipment and related accessories for motion picture production in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . The partnership will consist of DALSA, as the enabling technology foundation, and an industry partner, an established "film or HDTV (High Definition TV) A set of digital television (DTV) standards that offer the highest resolution and sharpest picture. Although some HDTV sets are available in standard (rather square) screen sizes, the overwhelming majority of sets are wide screen, which eliminates " camera rental firm based in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. . As the important first step, the Company has recently signed a letter of intent with a Hollywood based rental firm. Details about the agreement will be provided once the contract is finalized. For more information on DALSA's plans to commercialize the Origin cameras, A Digital Cinema Update presentation is available on DALSA's Investor Relations Investor relations The process by which the corporation communicates with its investors. website at the following address: http://www.dalsa.com/investor/investorevents.asp The Origin camera, which will be commercially available in November, continues to receive rave reviews. Footage from the short film, "Le Gant/The Glove", was recently shown to members of France's CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. (Commission Superieure Technique de l'Image et du Son, or "Advanced Technical Image and Sound Commission") at a screening in Paris. Audience members praised the camera for its "film-like" exposure latitude and outstanding image quality. Philippe Ros, the event's organizer, called DALSA's Origin images "magnificent" and "the highlight of the evening." The entire film will also be presented at the upcoming Toronto Film Festival in September. Bromont Expansion In June, the Company broke ground on a 12,000 square foot expansion to its semiconductor manufacturing facility in Bromont, Quebec Bromont is a city in southwestern Quebec in Canada, 75 kilometres (47 mi) east of Montreal on Autoroute 10, bordering the Eastern Townships at the base of Mount Brome (Mont Brome). . The expansion, which is expected to be completed by the first quarter of 2005 with an estimated total cost of $6 million to $7 million, will allow the Company to increase its capabilities in MEMS R&D and manufacturing. DALSA is also pleased to announce the appointment of Claude Jean as Vice President and Assistant General Manager for DALSA Semiconductor, reporting to Ralf Brooks, President, DALSA Semiconductor. Mr. Jean has been with the Bromont semiconductor facility since 1989 and has held a number of increasingly responsible positions up to and including his most recent job as Director of Operations. Tucson Relocation In March, DALSA announced that it would be relocating its Tucson operations to Colorado Springs Colorado Springs, city (1990 pop. 281,140), seat of El Paso co., central Colo., on Monument and Fountain creeks, at the foot of Pikes Peak; inc. 1886. It is a year-round resort and a booming military, technological, and commercial city. in order to create a larger, single US-based operating location with more efficient operational and management infrastructure. As of July 15th, the Tucson office has been closed, assets relocated, and all staff at Colorado Springs have been hired and fully trained. Colorado Springs employees have begun moving into a new 17,000 square foot facility. Subsequent to the announcement of the relocation, Hugh Garvey, former General Manager of Life Sciences, was offered an executive position in Waterloo but has since chosen to keep his family in Tucson and pursue other opportunities. Financial Goals Due to the strong results to date and improved markets for both the Semiconductor Business and the Digital Imaging Business, the Company is increasing its financial goals for 2004. Management's new goal for 2004 is $167 to $172 million in total revenue (previously $155 to $163 million) and net income in the range of $17.0 million to $18.5 million (previously $15.5 to $16.5), or $1.00 to $1.09 per share diluted (previously $0.91 to $0.97). Management expects revenues in the third quarter of 2004 to be in the range of $42 million to $44 million. Investor Conference Call A conference call to discuss the results will be held today, Thursday July 29 at 5:15pm ET. The conference call, followed by the question and answer period, will be broadcast live and open to anyone interested in listening at http://events.onlinebroadcasting.com/dalsa/072904/index.php. The phone numbers for those who wish to participate in the question and answer period are as follows: Live Conference Access information: Local Access: 416-405-9310 Toll-Free Access: 877-211-7911 Instant Replay Access information: Local Access: 416-695-5800 Toll-Free Access: 1-800-408-3053 Passcode: 3083848 Expiry Date: August 5th, 2004 About DALSA Corporation DALSA is an international high performance semiconductor and electronics company that designs, develops, manufactures, and markets digital imaging products and solutions, in addition to providing semiconductor products and services. DALSA's core competencies A core competency is something that a firm can do well and that meets the following three conditions specified by Hamel and Prahalad (1990):
DALSA is a public company listed on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. under the symbol "DSA". Based in Waterloo, ON, Canada, the company has operations in Bromont, QC; Colorado Springs, CO; Eindhoven, The Netherlands; Munich, Germany and Tokyo, Japan. This press release contains forward looking statements based on assumptions, uncertainties and management's best estimates of future events. Actual results may differ materially from those currently anticipated. Investors are cautioned that such forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. involve risks and uncertainties. Important factors that could cause actual results to differ materially from those expressed or implied by such forward looking statements are detailed from time to time in DALSA's periodic reports filed with the Ontario Securities Commission The Ontario Securities Commission (OSC) is a regulatory agency which administers and enforces securities legislation in the Canadian province of Ontario. The OSC is an Ontario Crown corporation which reports to the Ontario legislature through the Minister of Finance. and other regulatory authorities. DALSA has no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. |
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